Rajaratnam case is a 'wake-up call'

The pending crackdown, more than two years in the making and among the biggest undercover operations into insider trading, may yield charges against hedge-fund managers and their associates as early as this week, the people said, declining to be identified because the cases aren't public.

“This will remind people of insider trading laws and that they need to be careful when talking about sensitive business matters,” said Alan Kalin, a lawyer in corporate and securities matters at Bingham McCutchen LLP in Palo Alto, California. He expects more seminars on “the danger of being a tipster.”

At Polycom, Chief Executive Officer Robert Hagerty sent an e-mail to employees Monday reminding them of the rules against divulging confidential insider information. The Pleasanton, California-based company makes videoconferencing systems.

“We do have a very robust and unambiguous insider trading policy that all employees get,” Polycom Chief Financial Officer Michael Kourey said in an interview.

AMD, the world's second-largest maker of personal-computer processors, consistently reminds employees to manage confidential information properly, spokesman Prairie said. He didn't elaborate. Intel employees who deal with material information receive training on at least an annual basis, said Intel's Mulloy.

“You can reinforce what the policies are,” Paul Otellini, CEO of Intel, the world's largest chipmaker, said in an interview on Fox Business Monday. “Anyone who might have been thinking about it is probably not thinking about it Tuesday. The long arm of justice can reach out.”

Outside investor relations firms have access to confidential information as part of their jobs, said Jeff Zilka, a general manager at Edelman, a public relations company whose clients include Hewlett-Packard Co. and Microsoft Corp.

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